Healthcare Reform's First Birthday Is No Piece of Cake

March 22, 2011

March 22, 2011 — Tomorrow marks the first anniversary of the historic healthcare reform legislation known as the Affordable Care Act (ACA), but most physicians are not in any mood to light a candle or eat a piece of birthday cake.

Such widespread disenchantment might not be apparent in remarks by leaders of mainstream medical societies such as the American Medical Association (AMA), the American Academy of Family Physicians (AAFP), and the American College of Physicians (ACP), which supported the healthcare reform law in 2010 and continue to do so — more or less.

"The medical community recognizes that so much of the ACA is good," Charles Cutler, MD, chair of the ACP Board of Governors, told Medscape Medical News.

Dr. Charles Cutler

A different picture of what rank-and-file physicians think emerges in a January poll conducted by Thomson/Reuters and a company called HCPlexus. Seventy-eight percent of physicians said the ACA would negatively affect their profession, 74% predicted that the law would make physician reimbursement less fair, and 58% believed it would hurt patients too.

"It will have a negative impact because the 30 million newly insured will not be able to find a primary care physician," an unidentified California internist told pollsters. "There is already a shortage, and nobody is interested in primary care anymore."

Corroborating these results is a recent membership survey by the Texas Medical Association (TMA), which reports that 59% have an unfavorable opinion of the ACA and describe their feelings as disappointed (78%), anxious (74%), and confused and angry (62%). A nationwide survey conducted by The Physicians Foundation last fall produced the same kind of negative numbers.

Among physicians, disapproval of the ACA runs not only deep but also wide across specialties. Again, stances taken by medical societies might not suggest that pattern. Surgical and specialty societies tended to oppose the law, while the all-inclusive AMA and those representing primary care physicians were backers. However, in the survey by Thomson/Reuters and HCPlexus, only 11% of primary care physicians stated that the ACA would have a positive impact on their profession. The most optimistic were pediatricians and psychiatrists at 14%, while the least optimistic were cardiologists and surgeons at 3% and 4%, respectively. Clearly, no specialty stands out as a cheerleader for the new law.

The ACA is far more unpopular in the medical profession than it is in the general public. As of February, 48% of Americans viewed the law unfavorably compared with 43% who looked kindly on it, according to a tracking poll by the Henry J. Kaiser Family Foundation. This rough division in public sentiment has persisted in see-saw fashion since the law was passed. The Kaiser poll points to more support for the law than is apparent in those numbers. While 4 in 10 Americans want the ACA repealed, 3 in 10 would like to expand it and 2 in 10 would preserve it as is. Another 61% oppose defunding it.

"Between a Big Deal and a Drop in the Bucket"

Consumers may view the young law more positively than physicians because they have experienced more of its benefits.

If the healthcare reform legislation were a meal, the main course will not be served until 2014. That year, the ACA will require individuals to obtain insurance coverage and give tax credits to those struggling to afford it. Private insurers will be forbidden to deny anyone coverage on the basis of preexisting conditions. And expanded eligibility requirements for Medicaid will bring some 16 million more people into the program.

Healthcare reform appetizers, however, started appearing last fall. Cost-sharing for preventive care was eliminated in private insurance, as were coverage exclusions of children based on preexisting conditions, caps on lifetime benefits, and rescission of coverage during an illness. An estimated 3.4 million adult children could stay on their parents' policy to age 26. Tax credits began to kick in for small businesses buying health insurance for employees. Medicare beneficiaries who fell into the infamous "doughnut hole" of the Medicare Part D prescription program received $250.

More benefits have been dished out in 2011. Medicare beneficiaries now can buy brand-name Part D drugs at half-price. And cost-sharing for preventive services has disappeared for Medicare and Medicaid beneficiaries alike. That coverage change, said the ACP's Dr. Cutler, has opened the door to talk about vaccinations and cancer screenings with patients who in the past might have considered them unaffordable.

"The conversation is a lot easier now," Dr. Cutler said.

In contrast, economic benefits accruing to physicians so far have been less bountiful. Last fall, geographic adjustments to Medicare reimbursements bumped up for physicians outside urban areas. This year, Medicare will begin to pay a 10% bonus to primary care physicians for office visits and preventive care, and to general surgeons in underserved areas. Those payments will be made quarterly, with Medicare cutting checks in April for the first quarter of 2011, according to a spokeswoman for the Centers for Medicare and Medicaid Services.

Leaders of organized medicine tout these bonus checks as a step toward decreasing the pay differential between primary care doctors and their specialist kin. But more remains to be done.

"It will be between a big deal and a drop in the bucket," said the ACP's Dr. Cutler. "It's a good start. But does it shift the dynamic from going into well-paid specialties like cardiology and cause medical students to choose primary care? I don't think 10% will change enough minds."

A maven of physician behavior who agrees with that assessment is practice-management consultant Michael La Penna, president of The La Penna Group in Grand Rapids, Michigan. The bonus, La Penna said, merely catches up primary care physicians on measly reimbursement in the past.

"I can't think of one doctor who's said that the bonus will change their plans about practicing in the future," La Penna told Medscape Medical News.

Physician Support Soured by Lack of Doc Fix

One explanation for why most physicians boo the ACA — and why they are out of step with major medical societies that support the law — is its failure to address the Medicare reimbursement crisis.

Every year since 2003, physicians have faced ever deepening cuts to their Medicare rates triggered by the program's sustainable growth rate (SGR) formula. And every year, Congress has delayed the reduction, only for it to grow bigger the next year. The last time that happened was in December 2010, when lawmakers postponed a 25% decrease scheduled for January 1, 2011, by 12 months. However, on January 1, 2012, the SGR-mandated cut will roar back and reach 29.5% unless Congress acts again.

An early version of healthcare reform legislation authored by House Democrats would have cancelled the postponed Medicare reductions and replaced the SGR formula with one more generous toward physicians. However, Democrats removed this permanent "doc fix" to the SGR problem from the legislation because its price tag — more than $200 billion — would have made it harder for a deficit-minded Congress to pass healthcare reform. Subsequent efforts by Democrats to pass a stand-alone doc fix failed, degenerating into 5 piecemeal postponements from December 2009 through the end of 2010, not counting the delay until 2012.

At the time, support that the AMA, ACP, AAFP, and other medical societies lent to the first draft of healthcare reform seemed to depend heavily on inclusion of the doc fix. These groups confirmed that impression when their leaders threatened to withdraw their backing if Congress failed to replace the SGR formula. In the end, groups such as the AMA remained on the side of reform.

"It struck me at the height of the House bill discussion that physicians were bought off with the SGR fix," said Paul Ginsburg, PhD, president of the Center for Studying Health System Change. Dr. Ginsburg said he credits physicians with having supported the ACA for other reasons — expanded insurance coverage, for example — but there always remained the expectation of an SGR miracle. Its failure to materialize "undermines rank and file support for healthcare reform," he said.

AAFP President Roland Goertz, MD, also acknowledges the shadow cast by the failure to enact a permanent doc fix.

Dr. Roland Goertz

"The SGR problem colors the perception of the ACA," Dr. Goertz told Medscape Medical News. "It colors everything going forward."

Perhaps not surprising, when Texas physicians completed their recent TMA survey, they put Medicare payment reform as their top priority for Congress. In second place was opposing requirements to participate in Medicare as a condition of licensure. Revising or repealing the ACA was third.

"The Law Doesn't Seem to Be Real"

The ACA has been the law of the land for a year, yet its long-term impact on physicians is far from clear. In 2012, for example, Medicare is scheduled to begin experimenting with a new payment model involving so-called accountable care organizations (ACOs). These networks of providers — which can consist of medical practices and hospitals, or just medical practices — will continue to bill Medicare on a fee-for-service basis under the ACA. However, if ACOs can save money for Medicare through more efficient, coordinated patient services, they can share in the savings, assuming they also meet quality-of-care performance standards.

Although the topic of ACOs has set off a buzz in the hospital industry and medical profession, the Obama administration has yet to release the necessary regulations to spell out exactly how these groups will function. Publication is expected any day.

Adding to the uncertainty are legislative and legal challenges to the new law. Congressional Republicans are seeking to either repeal the ACA or at least cut off its funding. If the GOP gains control of the House and Senate in 2012, as well as puts one of its own in the White House, those legislative attacks could succeed. Meanwhile, opponents are engaged in a full federal-court press to overturn the law's requirement to obtain health insurance coverage as unconstitutional. So far, 3 judges have upheld the individual mandate while 2 have struck it down.

"Doctors are having a difficult time planning ahead," La Penna said regarding all the unanswered questions. "They ask me, 'How firm is this? Should we be planning for 2014? The law doesn't seem to be real.'"

La Penna tells the story of a specialty medical practice that was set to merge with another group and open a surgery center only to put its ambitions on hold as healthcare reform unfolded. "We can't sign a 20-year note on a new building," he quoted them as saying. "We don't know what's going to happen over the next 2 years."

However, La Penna and others advise physicians not to freeze in their tracks, but prepare for the future as best they can. Case in point is the much-discussed ACO model. Hospitals are already courting physicians as ACO partners, offering to buy their practices and hire them, according to the AAFP's Dr. Goertz. Yet physicians need not resign themselves to losing their independence, he said. "We're urging members to consider forming ACOs that are physician-led, that are composed just of physicians."

La Penna recommends the same kind of initiative.

"Hospitals will be ready to roll out ACOs the minute Washington decides what they should look like," La Penna said. "If doctors sit on the sideline, they could become part of somebody's solution instead of finding their own."

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